The Korea Technology Finance Corporation (Korea Technology Finance Corporation, Chairman Kim Jong-ho, hereinafter referred to as “KIBO”) announced on Tuesday the 16th that it had signed a “Mutual Growth Agreement to Strengthen the Competitiveness of Hyundai Motor Group Partners” with Hyundai Motor Company (hereinafter referred to as “Hyundai Motor Company”), Kia Motors, and KB Kookmin Bank (hereinafter referred to as “Kookmin Bank”).
This agreement was established to alleviate the management burden on small and medium-sized auto parts companies that are suffering from a chain reaction of demand shocks, such as a decline in exports to the U.S. due to the imposition of U.S. tariffs and a decrease in production and jobs, and to strengthen mutually beneficial cooperation by supporting smooth financing for Hyundai Motor Group partners.
According to the agreement, Kibo will provide a total of KRW 100 billion in agreement guarantees, with KRW 5 billion in special contributions from Hyundai Motor Company and Kia Motors and KRW 1.5 billion in guarantee fee support from Kookmin Bank.
Through this agreement, Kibo will provide preferential benefits, including an increase in the guarantee ratio (from 85% to 100% for three years) and a fixed guarantee fee (0.5% for three years). Kookmin Bank will subsidize the guarantee fee (0.5 percentage points for three years). Furthermore, Hyundai Motor Company and Kia Motors plan to separately deposit KRW 100 billion with Kookmin Bank to support interest rate reductions on loans to their partners.
Eligible for support are new technology companies that meet the technology guarantee requirements of the Korea Technology Finance Corporation and partners recommended by Hyundai Motor Group.
Through this agreement, each organization will jointly establish a financial support foundation to resolve funding difficulties and enhance competitiveness of Hyundai Motor Group's partners. Furthermore, through close collaboration, they will provide practical financial benefits, such as low-interest loans with zero guarantee fees, thereby practicing productive finance and actively supporting the sustainable growth of partners.
Kim Jong-ho, CEO of Kibo, said, “This agreement is significant in that it promotes supply chain stability and shared growth through financial support for partners, and strengthens the competitiveness of the automobile industry.” He added, “Going forward, Kibo will expand cooperation with related organizations to proactively respond to internal and external uncertainties and do its best to create an ecosystem based on mutually beneficial cooperation.”
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